Rudy sold US$130m in Bank Bali assets: IBRA

JAKARTA (JP): Former president of Bank Bali, Rudy Ramli, is "indicated" to have quietly sold some US$130 million of the bank's loan portfolio assets which may increase the bank's recapitalization cost, the Indonesian Bank Restructuring Agency (IBRA) has disclosed.

IBRA deputy chairman Farid Harianto said on Monday that the loan assets sold by Rudy included nonperforming loans (NPLs), which were supposed to be transferred to the agency later on in return for government recapitalization funds to be injected into the bank.

"We're greatly concerned because this may increase the recapitalization cost (of the bank)," Farid told a small group of reporters at a gathering also attended by IBRA Chairman Glenn S. Yusuf.

"But we're still verifying this indication and are investigating where the money went," he said, adding that international accounting firm KPMG reported the indication on July 20 to IBRA.

KPMG was assigned to audit Bank Bali prior to joining the government-sponsored bank recapitalization program.

The government promised in April that it would finance up to 80 percent of the bank's recapitalization program which, according the latest estimate, increased to Rp 4.3 trillion as of June.

Farid said that KPMG was still auditing the bank to calculate the final figure of the recapitalization cost.

Publicly listed Bank Bali is expected to offer a rights issue in October to raise funds to finance the recapitalization program.

U.K-based Standard Chartered Bank, which has been controlling the management of Bank Bali since July 26, promised to buy a 20 percent stake in Bank Bali through the rights issue.

IBRA took over ownership of Bank Bali on July 23 after the Ramli family, the former owner of the bank, failed to come up with 20 percent of the recapitalization fund needed by July 22.

Rudy told the media last week that he suspected Standard Chartered might have been involved in stratagems to take over his bank.

Rudy has also been implicated in the high-profile Bank Bali scandal, in which some Rp 546 billion (US$80 million) was transferred out of the bank in early June as a commission for service given by investment firm PT Era Giat Prima (EGP) to help the bank recoup some Rp 904 billion in interbank claims on closed-down Bank BDNI.

EGP is owned by businessmen Djoko Chandra and Setya Novanto who are affiliated with the ruling Golkar Party, raising speculation that part of the commission was used to finance the party's campaign to secure election of President B.J. Habibie in November.

IBRA said earlier that Bank Bali should have not used the service of EGP because interbank claims on closed-down banks were guaranteed by the government through the blanket guarantee program.

The Bank Bali scandal has irked the International Monetary Fund (IMF), which is organizing some US$46 billion in bailout funds for the crisis-hit country. The Fund has demanded an independent, speedy investigation into the alleged scandal.

IBRA has appointed international auditor PricewaterHouseCooper to validate its internal investigation into the Bank Bali scandal.

"PricewaterHouseCooper will start working on Wednesday (today). We want it to be completed immediately," he said.

Glenn said that IBRA's internal investigation focused on the transaction made between Bank Bali and EGP.

"We have to cooperate with Bank Indonesia to trace where the money went," he said, pointing out that IBRA had no authority to enter state Bank BNI.

Bank Bali transferred the commission to the accounts of EGP's Setya and Djoko at Bank BNI.

Glenn said that the agency's top priority was to collect the money which was transferred out of Bank Bali.

Separately, Bank Indonesia Governor Sjahril Sabirin said on Tuesday that EGP would return all of Bank Bali's money by Wednesday (today).

He said that some of the money was already returned on Monday.

"Some of the money was returned yesterday but I have not checked how much," Sjahril told reporters at the State Palace on the sidelines of the Independence Day ceremony.

In a related development, law firm Muchyar Yara & Associates lodged a strong warning on Monday to EGP's Djoko to immediately withdraw his statement made last week to the daily Media Indonesia that Coordinating Minister for Economy, Finance and Industry Ginandjar Kartasasmita was involved in the Bank Bali case. (rei/prb)